2007 Annual Review Redefining the Industry

Transcription

2007 Annual Review
Redefining the Industry
apmterminals.com
APM Terminals 2007 Annual Review 1
Supervising
2 APM Terminals
operations
2007at
Annual
APM Terminals
Review Oakland, California
Contents
5
6
8
10
13
15
17
18
21
22
25
26
The CEO’s perspective
Financial performance
The global economic context our platform for growth
Our global reach Providing customers access to world markets
APM Terminals: Proud history - bright future
Developing our business
Regional highlights
The best people:
The best talent and opportunities
Health, safety, security and the environment
Leadership perspectives
APM Terminals’ organization
On the cover: Redefining the industry
Our new 291 acre APM Terminals Virginia facility, the third-largest
container terminal in the US (and the largest privately-owned)
opened in September 2007, heralding a new era in environmentallyfriendly container terminal development and design. The USD 450
million state-of-the-art terminal has a current capacity of 1 million
TEUs, with the potential for expansion to 2 million TEUs annually.
The
4 APM
port
Terminals
of Rotterdam,
2007Netherlands
Annual Review
The CEO’s perspective
Delivering
value to
our customers
2007 was a year of major achievement for
APM Terminals, as we consolidated our
position in a rapidly growing market at the
heart of world commerce. Since 2001, we
have achieved double-digit growth rates
taking us to a position as one of the world’s
leading container terminal operators in just
seven years.
This report examines the advances we
made in 2007 by focusing operations
on customer service and financial
performance. The drivers behind this
momentum were the passion and talent of
our people, our investment in developing
outstanding facilities around the globe, and
a re-dedicated focus on our customers to
ensure we deliver the service they need,
wherever they need it.
Global container trade volumes are on
course to double again within the next ten
years according to industry analysts. As
you will see in this report, APM Terminals
is responding vigorously to these exciting
developments.
We are engaged in a comprehensive
program of investment in both new and
existing terminals to address the pressure
this rapid growth places on port and
landside infrastructures worldwide.
“2007 was a year of
major achievement
for APM Terminals as
we consolidated our
position in a rapidly
growing market at
the heart of world
commerce.”
We have also increased the speed of
execution of new projects. For example, in
Luanda, Angola, we achieved operational
control of the terminal in just 90 days.
Equally important, we have introduced
process excellence initiatives in targeted
locations to achieve productivity gains.
Looking ahead, there are more exciting
developments afoot across all our seven
regions – you’ll read more about these in
the words of our regional executives later
in this report.
Looking further ahead, our dedicated team
of world-class experts in port development,
operations and business planning are
working closely with our customers to
anticipate their future needs. That is why
today we are proud to offer the only truly
global terminal network in the industry,
providing access to every market, and why
we are confident of meeting the projected
needs of our customers over future decades.
We are very well positioned for 2008. We
are working hard to become the partner
of choice for the container industry. We
have developed strong relationships with
strategic customers and will continue to
build more. We have put together a team
that is passionate about our business and
determined to offer superior value to all of
our customers.
This is our future.
We hope you find it as exciting as we do.
Kim Fejfer, CEO, APM Terminals
The Hague, Netherlands, March 1, 2008
Financial
performance
2007 saw revenue grow by 22% over 2006’s performance to USD 2.52
billion. This revenue growth has been driven mainly by increased volume.
Earnings before interest, taxes,
depreciation and amortization (EBITDA)
increased to USD 404 million in 2007.
The net profit of USD 111 million is also
an improvement compared to 2006. This
is, however, affected by the increased
financing costs for our continued high
growth, with the development of many new
terminals and their start up costs.
Net profit from terminals that have been in
operation for more than a year increased
by 30% compared to 2006. There was
significant improvement in the net profit,
especially for the Asian terminals, although
the net profit for the terminals in North
America was lower than in 2006 as a result
of lower utilization of capacity. The improved
profitability for the Asian terminals made
the recognition of a deferred tax asset
possible, which positively affected the net
profit for the year.
The EBITDA margin remained at 16%. In
addition to the continued high growth, the
margin is affected by capacities in some
terminals being committed to Maersk Line
on long term contracts with low risk and
therefore low returns.
Volumes rose by 13% to 31.4 million
TEU in 2007, equating to a global market
share of 6.4%. Although volumes in North
America decreased by 9%, they increased
by 20% for the rest of the world giving us
an average increase of 13% in 2007. The
external turnover from customers other
than Maersk Line grew in 2007 to 34% of
the total volumes.
6 APM Terminals 2007 Annual Review
APM Terminals 2007 financial performance (USD million)
Turnover
EBITDA
EBIT
Net profit for the year
Fixed Assets
Cash flow from operations
Cash flow from investments
2007
2.519
404
172
111
3.737
259
–853
2006
2.065
333
174
99
2.802
226
–1.096
APM Terminals operates globally through
joint venture agreements with local
business partners. Although 51% of all
crane lifts on container terminals are
performed in China and Asia, when the
market is pro rated by ownership share,
the market is skewed towards Europe
and North America, as shown in the pie
charts. This is partially due to the fact that
terminals in China and Asia are generally
joint ventures with ownership shares that
are lower than in Europe and North America
where terminals are often 100% owned.
APM Terminals also seeks to develop
container terminals in direct co-operation
with its customers. The partnership with
Cosco for the expansion of the terminal
in Port Said, Egypt, is an example of this.
Further details of our expansion plans and
the new terminals we are developing can
be found in the section ‘developing our
business’ on page 17.
2007: The world market in APM Terminals’ regions total world market throughput* split to APM Terminals’ regions (source: Drewry)
7%
5%
30%
8%
10%
19%
Africa
Greater China
Asia
Europe
North America
West Central Asia
Americas
21%
*The container terminal market is defined as total throughput in container terminals worldwide including empty/full/
load/discharge/transfer moves (in million TEU)
2007: APM Terminals’ volume % by regions (equity weighted) - throughput per APM
Terminals’ region divided by total APM Terminals throughput (in million TEU)
7%
3%
17%
10%
11%
18%
Africa
Greater China
Asia
Europe
North America
West Central Asia
Americas
34%
The global
economic
context...
According to the World Bank’s “Global
Economic Prospects 2008” report, overall
global economic expansion was 3.6% in
2007, spurring an increase in world trade
volume of 9.2%. Despite an anticipated
slowdown in the USA, this growth trend is
expected to continue in the future.
In addition to the strong growth in
world trade, more and more cargo is
being transported in containers, with
containerized shipping offering a safe,
efficient and affordable alternative to other
means of transport. Over 95% of all trade
is carried by ocean vessels - increasingly in
containerized shipments - creating strong
growth in the port sector with volumes
expected to double over the next decade.
We have a comprehensive and wellbalanced global portfolio of terminals
designed to thrive in both up and down
market cycles while meeting the needs of
the future growth of world trade.
Container ports around the world
experienced strong growth in 2007:
Five large Chinese ports experienced
growth rates above 20% - Guangzhou
(39%), Ningbo Zhousan (32%), Tianjin
(19%), Qingdao (23%) and Shanghai
(20%) – reaffirming the rapidly escalating
importance of the Chinese economy on
the world stage. Confidence in this strong,
vibrant sector is reflected by significant
and high profile investment, merger and
acquisition activity in the last year with
strong equity interest for terminal assets.
Global deepsea container trade
(millions of TEUs)
200
100
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
...our
platform
for growth
APM Terminals will maintain its
commitment to investment and
expansion to support our customers
in capitalizing upon this economic
expansion. As one of the world’s
largest terminal operators in terms of
volume and capacity, with more than
50 terminals in 31 countries and on
five continents, we are well-positioned
to meet the needs of projected global
container traffic growth.
World’s top container ports
(Throughput volume in millions of TEUs)
2006 Ranking
2005 Ranking
Port
Country
Throughput
2006
Throughput
2005
% Change
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
1
2
3
4
5
6
7
9
8
10
13
11
15
12
18
14
16
17
19
21
Singapore
Hong Kong
Shanghai
Shenzhen
Busan
Kaohsiung
Rotterdam
Dubai
Hamburg
Los Angeles
Qingdao
Long Beach
Ningbo
Antwerp
Guangzhou
Port Klang
Tianjin
New York/NJ
Tanjung Pelepas
Bremerhaven
Singapore
China
China
China
S. Korea
Taiwan
Netherlands
UAE
Germany
USA
China
USA
China
Belgium
China
Malaysia
China
USA
Malaysia
Germany
24,792,400
23,539,000
21,710,000
18,468,890
12,030,000
9,774,670
9,603,000
8,923,456
8,861,545
8,469,853
7,702,000
7,289,365
7,068,000
7,018,799
6,600,000
6,300,000
5,950,000
5,092,806
4,770,000
4,400,000
23,199,252
22,480,000
18,080,000
16,197,000
11,840,000
9,470,000
9,286,757
7,619,000
8,087,545
7,484,624
6,307,000
6,709,818
5,208,000
6,488,029
4,684,000
5,540,000
4,801,000
4,785,318
4,177,000
3,735,574
7
5
20
14
2
3
3
17
10
13
22
9
36
8
41
14
24
6
14
18
Source: Container Management July/August 2007
Our global reach
North America Region
1 Tacoma, Washington, USA
2 Oakland, California, USA
3 Los Angeles, California, USA
4 Port Elizabeth, New Jersey, USA
5 North America Regional Head Office
Charlotte, North Carolina, USA
6 Portsmouth, Virginia, USA
7 Charleston, South Carolina, USA
8 Savannah, Georgia, USA
9 Mobile, Alabama, USA
10 New Orleans, Louisiana, USA
11 Houston, Texas, USA
12 Jacksonville, Florida, USA
13 Port Everglades, Florida, USA
14 Miami, Florida, USA
26
25
23
24
27
28
37
22
20 21
1
30
4
2
5
3
11 10
9
8
12
7
31
32
33
29
35
6
13
14
15
16
38 39 40 41
42
17
43
18
44
19
Americas Region
15 Kingston, Jamaica
16 Americas Regional
Head Office Panama
17 Posorja, Ecuador
18 Itajai, Brazil
19 Buenos Aires, Argentina
Europe Region
20 Le Havre, France
21 Dunkirk, France
22 Zeebrugge, Belgium
23 Rotterdam, Netherlands
(also new terminal project)
24 Europe Regional Head Office
Rotterdam, Netherlands
25 Bremerhaven, Germany
26 Wilhelmshaven, Germany
27 Global Head Office
The Hague, Netherlands
28 Aarhus, Denmark
29 Algeciras, Spain
30 Vado, Italy
31 Genoa, Italy
32 Cagliari, Italy
33 Gioia Tauro, Italy
34 Constantza, Romania
35 Tangier, Morocco
36 Port Said (SCCT), Egypt
37 Kaliningrad, Russia
34
70
36
69 68
67
57 58
66
65
45
46
47
48
64
63
49
50
51
59 60 61 62
53
52
Africa Region
38 Abidjan, Ivory Coast
39 Tema, Ghana
40 Apapa, Nigeria
41 Onne, Nigeria
42 Douala, Cameroon
43 Luanda, Angola
44 Africa Regional Head Office
Cape Town, South Africa
54
55
56
West Central Asia
45 Aqaba, Jordan
46 Mina Salman, Bahrain
47 West Central Asia Regional
Head Office Muscat, Oman
48 Salalah, Oman
49 Port Qasim, Pakistan
50 Pipavav, India
51 Mumbai, India
52 Colombo, Sri Lanka
Asia
53 Laem Chabang, Thailand
54 Cai Mep, Vietnam
55 Asia/Oceania Regional
Head Office Singapore
56 Tanjung Pelepas, Malaysia
57 Kobe, Japan
58 Yokohama, Japan
Key
Head Offices
Operational terminals
Terminals with expansion projects
New terminal projects
Greater China
59 Guangzhou, China
60 Yantian, China
61 Dachan Bay, China
62 Nansha, China
63 Kaohsiung, Taiwan
64 Xiamen, China
65 Yangshan, China
66 Shanghai (SECT), China
67 Qingdao, China
68 Dalian, China
69 Tianjin, China (2 ports)
70 Greater China Regional
Head Office Beijing, China
An
12 Evergreen
APM Terminals
container
2007
departing
Annual Review
the port of Qingdao, China
Providing
customers
access to
world markets
APM Terminals provides worldwide coverage via a global terminal network
of more than 50 container facilities in 31 countries across five continents.
We provide operational expertise and logistics solutions to more than 60
liner operators that depend on our efficient terminal operations for their
global supply chain management needs.
As our customers evolve and expand, we
work in partnership with them - not just
to meet their requirements but also to
provide insight so they can take advantage
of future opportunities. We build our
customer relationships on a platform of
trust and professionalism.
Our diverse customer portfolio includes
liner operators such as APL, CMA-CGM,
COSCO, Evergreen, Hanjin, Horizon, K-Line,
Maersk Line, MSC and Zim.
Our expanding global terminal network at
ports in every major trade lane provides
customers such as these with greater
options and flexibility to serve the global
supply chain. This advantage can be
crucial in regions in which logistics
bottlenecks are forming, or where
container volumes are particularly high.
Our strategic investments in China and
India in 2007 were specifically designed to
address these issues.
Our customers operate in a highly
competitive market with narrow margins.
While world container trade may be
growing dramatically, our customers face
increasing cost and service pressures
every year. We work closely together
with customers to offer them new and
innovative ways to access expanding global
Our customer-centric
approach was
fundamental to our
achievements in 2007
Regionally, we coordinate with customers
to optimize vessel scheduling and
utilization, reduce costs, and enter
new markets. Locally, our terminal
managers respond effectively to
customers’ operational needs and
provide solutions for the weekly, daily and
hourly requirements of our customers for
availability of berths, cranes and gates.
Our customer-centric approach was
fundamental to our achievements in 2007.
We know that our future success depends
on ever-higher standards of world-class
customer service. We are ready to meet
this challenge in 2008 and going forward.
markets. Strategic port locations and the
integrated APM Terminals’ global terminal
network provide access and opportunity for
business growth in the shipping industry.
Globally, our key account teams are
dedicated to supporting customers’ longrange planning and investments.
The
14 APM
port Terminals
of Zeebrugge,
2007
Belgium
Annual Review
APM Terminals:
Proud history bright future
Today, APM Terminals is one of the largest terminal operators in the world
in terms of its capacity - 78 million TEUs. Our market share is expanding
rapidly as we continue to grow faster than the market as a whole.
APM Terminals offers the most
geographically balanced and
comprehensive terminal network of
any terminal operating company, in
combination with fully integrated services
to shippers and shipping companies.
Present in every region in the world on
major shipping routes, we are the only
global terminal operator with facilities in
US ports, with 12 terminals in operation
and a 13th scheduled to open in Mobile,
Alabama, in 2008.
Our Heritage
APM Terminals’ parent company, the
A.P. Moller-Maersk Group, has a proud
heritage of over 100 years of excellence in
transportation and energy, and opened its
first general cargo terminal half a century
ago in Brooklyn, New York. After years of
steady growth, A.P. Moller-Maersk opened
the Port of New York’s first dedicated
container terminal at Port Newark, New
Jersey in 1975, a landmark event for the
company, and the industry.
We offer services for trans-Pacific and
trans-Atlantic container traffic and we have
large facilities in the rapidly growing Far
East-Europe, and Far East-Mediterranean
trade lanes. But, this is just the beginning.
We will continue to invest, expand and
innovate, building on our achievements of
the last seven years.
In 1999, the A.P. Moller-Maersk Group’s
container shipping division, Maersk Line,
acquired US-based Sea-Land Services.
This created a significant increase in the
Group’s portfolio of container terminals,
and so it was decided in 2001 that APM
Terminals should begin a new life as
an independent company within the A.P.
Moller-Maersk Group.
To further emphasize its status as a
separate and distinct business concern, in
2004 APM Terminals’ headquarters were
relocated from Copenhagen, Denmark, to
The Hague, Netherlands.
In the past seven years APM Terminals
has rapidly emerged as a leader in the
container industry and a world-class
terminal operating and management
company. We have extensive and
ambitious plans to build upon this
success, to provide added value for
our customers by enhancing our global
terminal network in 2008 and beyond.
Our
new Terminals
terminal at2007
Portsmouth,
16 APM
AnnualVirginia,
Review USA
Developing
our business
We expect growth in demand for container terminal capacity to
continue in the future - and our customers will be looking to APM
Terminals to deliver capacity wherever and whenever it is needed.
To continue our success in securing
necessary capacity for our customers
we are focusing on strengthening the
business development and project
implementation organizations within our
seven regions - and we are developing
our expertise in market intelligence and
stakeholder engagement.
The success of our business development
strategy enabled APM Terminals to achieve
more than 10 new wins in 2007.
Our achievements in 2007
The APM Terminals’ portfolio now includes
50 terminals in 31 countries on five
continents, with 13 new projects underway.
New facilities were opened in:
• Portsmouth, Virginia, USA
• Tangier, Morocco
• Xiamen, Tianjin and Guangzhou, China
• Le Havre, France
• Luanda, Angola
And we took operational control of the
terminal in Tema, Ghana.
2007 was a significant year of progress
and development for APM Terminals. More
importantly, these developments provide
value for our customers through greater
flexibility, greater efficiency and new
opportunities.
The success of our
business development
strategy enabled APM
Terminals to achieve
more than 10 wins
in 2007
Expansion of existing terminals
We have secured the rights to expand our
existing facilities in a number of locations
in order to prepare them for future volume
growth. These expansions include projects
in our existing facilities in:
• Salalah, Oman
• Itajai, Brazil
• Buenos Aires, Argentina
• Mumbai, India
• Shanghai, China
• Port Said, Egypt
• Qingdao, China
• Pipavav, India
New sites
Beyond the improvements to our existing
portfolio, we have also secured the rights
to develop a number of new projects:
• Luanda, Angola
• Posorja, Ecuador
• Dachan, China
• Shenzhen, China
These new projects will contribute to the
continued growth and development of
APM Terminals, to meet the demands of
the future.
The boom in global infrastructure has
resulted in new players entering the industry
and higher port valuations. Our focus in
2008 - as part of developing our business
- will include continuously reviewing and
optimizing our existing portfolio of terminals
to suit our customer needs.
In addition to these expansions, we have
also increased our shareholding from
50% to 100% in the facility in Itajai, Brazil,
solidifying our leadership at the facility.
Regional
highlights
Greater China Region,
Kim Riisom Gadegaard
2007 saw unprecedented growth in China.
The total Chinese container throughput
for the year broke through the 100 million
TEU mark and the total throughput for the
Greater China Area (including Hong Kong
and Taiwan) was expected to reach 148
million TEU.
North America Region,
Eric A. Sisco
2007 has been a year of challenges
and opportunities for APM Terminals
North America. The softening US economy
and the unresolved sub-prime mortgage
developments have reduced import
demand, while the weakened US dollar has
energized the export market somewhat.
“...foundation for
future expansion”
“...most technologicallyadvanced facility in
“…high levels
North America”
of service”
APM Terminals benefited from this sharp
growth and expanded its capacity with
the opening of Xiamen Songyu Container
Terminal (Xiamen Port) and Guangzhou
South China Oceangate Container Terminal
(Nansha Port) Further developments in
Qingdao port were also secured and a
ground breaking ceremony for the first
phase of construction took place in
September 2007. This laid the foundation
for continued expansion.
The outlook for 2008 is strong with an
expected GDP growth above 10% for China
and moderate economic growth for Hong
Kong and Taiwan. Overall, the container
terminal markets in the Greater China Area
are expected to grow 14% reaching a total
throughput of 170 million TEU in 2008.
Shanghai will continue as one of the main
growth drivers and 2008 may be the year it
overtakes Singapore as the world’s largest
container port. APM Terminals expects to
continue its high growth pattern and to enter
new ports in 2008.
We expect the general market trends and
our own volume development to improve
in 2008 and 2009, with longer term
projections indicating a terminal capacity
shortage in key US markets. Accordingly,
we have undertaken significant expansion
projects in 2007. Most notable of these
is the opening of our Virginia Terminal
which is the most technologically-advanced
facility in North America.
We have also significantly expanded our
Elizabeth, New Jersey facility which serves
the New York/New Jersey market, and we
are in the final development stages of a
new terminal in Mobile, Alabama, which
will serve the emerging Eastern US Gulf
markets. We are developing this project,
which will open in mid-2008, with our joint
venture partner CMA-CGM. Greenfield and
terminal expansion projects in the US
Pacific Northwest and Canada are also
being evaluated.
Europe Region,
Martin Poulsen
Strong growth in trade between the Far
East and Europe, reaching nearly 18%
to North Europe and over 20% to the
Mediterranean/Black Sea, meant solid
volume increases in most of our main
European and Mediterranean terminals.
In particular Eastern Europe (Russia
and the Black Sea area) is experiencing
massive growth, albeit from a smaller base.
Competition for new projects has
increased, but in 2007 APMT secured
a number of new concessions including
Vado (Italy) and Phase 2 expansion in
Port Said (Egypt). New projects that
started operation in 2007 include Tangier
(Morocco) and Le Havre (France). The
Europe regional office in Rotterdam (The
Netherlands) was established in January
2007 and is already proving successful in
delivering high levels of service and value
to our customers.
Utilization rates in main ports are
expected to remain high in 2008 as
increased demand is expected to outpace
growth in supply.
West & Central Asia,
Jorgen Hammelsvang Madsen
Last year was a period of remarkable
growth with regional terminal container
throughput nearly 40% higher than in 2006.
In 2008, we expect our overall volume to
increase by another million TEUs as we take
steps to meet the needs of our customers.
“…meeting the needs
of our customers”
APM Terminals assumed control of
Bahrain’s Mina Salman port in December
2006, implementing significant operational
improvements to enhance service levels to
customers. The Port of Salalah, in Muscat,
Oman, opened its fifth berth in May 2007,
adding 900,000 TEUs capacity. Gateway
Terminals India (GTI), inaugurated in
January 2007 at the Port of Mumbai, India’s
most important and largest container port,
handled its one millionth TEU in just eleven
months. This tremendous performance was
recognized with GTI named “2007 Port of
The Year” for the Middle East and South
Asia by Lloyds List.
In the year ahead, we will continue to expand
our services. Operations will be shifted from
Mina Salman to the new Bahrain Gateway
(Khalifa Bin Salman Port) in the 3rd quarter
of 2008. Berth six will become operational
at the Port of Salalah, and work will begin
on the expansion of berths seven, eight and
nine. In India, GTI’s 600,000 TEU expansion
will be completed by year end, and Pipavav
Port, in Gujarat, India will commission its
second container berth this spring.
Africa Region,
Richard Nicholson
Economic growth in Africa is at its highest
levels in thirty years, with continuing GDP
improvement forecast over the coming five
years and APM Terminals is targeting this
market for our customers’ growth.
During 2007, APM Terminals emerged as
a leading terminal operator in West Africa
with the successful takeover of primary
container handling facilities in Luanda,
Angola and Tema, Ghana, along with the
completion of construction of its new
terminal facility in Onne (Port Harcourt),
Nigeria. While productivity remains a
challenge on the West African Coast,
several APM Terminals facilities including
Abidjan, Ivory Coast and Douala, Cameroon
are being recognized as best in class.
In August, APM Terminals acquired 51%
of Alinport SA in Ecuador, a greenfield
container port project south of Guayaquil.
Construction will start in 2008 and the
first phase of the port – a 450 meter
berth with four cranes and a capacity
of 700,000 TEU - is expected to be
operational by early 2010.
We look forward to 2008 with confidence,
excitement and expansion of our Americas’
port offerings to serve our customers in
this major market.
“…preferred partner”
2008 will see a continued focus on both
profitability and operational excellence in
the existing portfolio, and on being the
preferred partner of governments and port
authorities across the continent.
Asia-Oceana Region,
Martin Gaard Christiansen
2007 has been a strong business year
focusing on getting closer to customers,
improving our service reliability in key hubs
and building a stronger safety culture.
The organization has been strengthened
in the areas of business development,
operations and commercial, and through
global procurement agreements and best
practice sharing, we have been able to
respond faster to operational challenges
when they arise.
Americas Region,
Soren Sjostrand Jakobsen,
2007 has seen a number of significant
developments as we expanded our
interests in the Americas region.
“…getting closer to
“...significant
customers”
developments as we
outlook for 2008 in Asia is exciting as
expanded our interests The
we upgrade our existing facilities to cater
the future demands of our customers,
in the Americas region” for
and place an emphasis on increasing
In May, we acquired the remaining 50%
of the shares in Teconvi SA in Itajai
Brasil and are now the sole owner of
the terminal. This development was
swiftly followed by the commencement
of an expansion program at the terminal
including a new berth, expanded yard and
cranes. When completed in 2009 the
terminal will have a capacity of 1.1 million
TEU. Terminal 4 in Buenos Aires Argentina
won the bid to handle the Hamburg Sud,
NYK, Maersk Line VSA service from
the Far East. In Kingston, Jamaica, the
management agreement with the Port
Authority of Jamaica was extended for
another two years.
service reliability and terminal efficiency.
We will be increasing our footprint in
the region through new projects in key
locations and continue to build the talent
pipeline needed to succeed in a fast
moving and competitive environment.
Our goal is to be the clear employer of choice in the industry
The best people:
The best talent
and opportunities
At APM Terminals, we passionately believe
that our people are the key to our success
and differentiate us from our competitors.
That’s why our investment in the best talent
is no less important than our investment in
the best equipment and technology.
We have continued to develop the
internal general business and terminal
management training programs called
MAGNUM and MAGNET. APM Terminals
offers management-trainee positions to
young talent as part of our global program.
Customer surveys confirm that APM
Terminals is renowned for the caliber of its
people and the intelligent and innovative
solutions they provide. We are enriching
our capability over the coming years, and
plan to supplement our existing talent pool
by leveraging our best talent inside the
company and supplementing this resource
from the outside.
In parallel, at a more local level, we have
established seven regional offices. These
highly empowered regional leadership
teams are pivotal in leading the existing
terminals and in establishing new ones.
As we expand geographically, it is essential
that we employ a diverse workforce in
terms of their work experience, nationality
and culture. APM Terminals attracts the
best talent from the market place to
join our high performance team with an
emphasis on development and personal
growth and exposure to some of the world’s
most fascinating places. This is a unique
opportunity to be part of an exciting and
successful global business environment.
Employer of choice
Our goal is to be the clear employer of
choice in the industry. In 2007, 60 of our
senior executives received training at IMD,
in Lausanne, Switzerland - one of the world’s
top-ranked business schools. This program
is now being cascaded to 250 of our top
managers around the world.
Innovation and creativity is actively cultivated
and our strong emphasis on values has
created a collaborative and focused team at
all levels in the organization. APM Terminals
has an entrepreneurial spirit that energizes
and motivates people. This enables us to
fuel our development in 2008 and beyond.
Preparing for the future
Simon Reitsma – Vice President, HR
2007 was a year of major progress for us. On
January 1, we became a more independent
business unit within the A.P. Moller-Maersk
Group. The majority of terminals started
to report directly into us, and overnight we
transformed from an organization of 500 to
one with 20,000 employees.
This presented a big challenge, which we
met head-on to realize the opportunities it
presented, in terms of true globalization and
diversity of nationalities, culture, education
and vocation. Crucially, throughout this
growth, we have managed to preserve the
culture of entrepreneurship that characterizes
and differentiates APM Terminals.
The key to this has been training, alignment
and APMT ‘brand’ loyalty throughout our
staff. We retain talented and committed
people through specific career development
and attractive rewards and incentives.
In 2007, we laid the foundations for our
talent development program with a twopronged approach: we created specific
training initiatives to develop both our
current leaders and our leaders of the
future, and we also implemented clear
career and succession planning processes.
We continue to welcome new colleagues
from outside of the A.P. Moller-Maersk
Group. This corporate diversity is of
key importance as well. It helps us to
understand the local cultures within our
global organization, while diversity of views
also generates richer solutions. We are an
equal opportunity employer who believes
diversity leads to strength.
“...a year of
major progress”
In 2008 we look to continued growth driven
by the talents and professionalism of our
people. We will be more closely linking
reward to performance and encouraging our
high potential talent to take assignments in
locations that will provide unique business
or cultural challenges.
APM Terminals’ new and much larger
organization provides fantastic career
opportunities for our people. We look
forward to a future where we continue
to attract, retain and develop the future
leaders of our business.
Health, safety,
security and
the environment
The health and safety of our employees, the security of our customers’
cargo and managing our environmental impact are core concerns of
APM Terminals.
9.6
2007 year end average
7.1
Dec
7.8
Nov
9.2
Oct
10.2
Sep
10.1
Aug
9.8
Jun
In 2008 we will focus on further
improvements in our safety culture – aiming
to reduce our Lost Time Injuries (LTIs) in
2008 by 15% over 2007. Each terminal
will implement the APM Terminals’ Safety
Conformance System. This forms part of
the overall ‘safety management system’
used at our terminals and compliance with
the system is internally audited to assess
Jul
May
10.5
Apr
9.7
Mar
9.2
6.3
Feb
11.7
14.1
Jan
15
2006 year end
In 2007, we introduced health, safety,
security and environmental training
into the syllabus of our management
programs such as MAGNUM/MAGNET,
and in October we designated a “Global
Safety Day”. To encourage all personnel
to recognize and discuss safety issues,
the company stopped operations at every
terminal on October 24th for 30 minutes to
emphasize the importance of engagement
and partnership with customers, truckers,
the waterfront workforce and suppliers to
make our container terminals free from
accidents. Our customers, labor leaders
and the industry applauded this initiative.
Led from the top, we continue to work hard
to engrain the safety culture throughout the
organization. Last year our Lost Time Injury
Frequency (LTIF) ratio across the business
declined by 33% to 9.6 LTI’s per 1 million
man hours, which puts us amongst the
leading operators in our industry.
2005 year end
Safety
At APM Terminals we have a zero tolerance
for unsafe behavior and we believe all
accidents can and should be avoided.
Safety is a joint effort and is an important
part of how we work together at APM
Terminals and with our business partners.
Our ambition is to reduce the number
of accidents at our terminals to zero.
However, despite improvements in our
safety record in 2007, regrettably, there
were 10 fatalities involving vendors and
truckers inside our terminals in 2007.
32.5
Lost time injury frequency 2007
the safety management at each terminal.
Compliance will ensure continuous
improvements, aiming to increase the
safety and competencies of each of our
employees and drive our safety culture.
We believe continued strong improvement
in policies and procedures combined with
personal commitment and training will yield
further reduction in LTIs in 2008.
Security
Across the business, we have increased
our focus on business continuity guidelines,
emergency response plans and training.
Our global terminal network is International
Ship and Port Security code (ISPS)
compliant, and in the United States, fully
Marine Transportation Security Act (MTSA)
compliant. Training of our Port Facility
Security Officers is ongoing.
APM Terminals has been an active member
of the US Government’s Custom-Trade
Partnership Against Terrorism (C-TPAT)
program since May 2003, and was the first
port operator in the world to sign up for
the program. C-TPAT is a joint governmentbusiness initiative to build cooperative
relationships that strengthen overall supply
chain and border security. C-TPAT recognizes
that U.S. Customs can provide the
highest level of security only through close
cooperation with the ultimate owners of the
supply chain— importers, carriers, brokers,
warehouse operators and manufacturers.
Through this initiative, C-TPAT asks
businesses to ensure the integrity of
their security practices and communicate
their security guidelines to their business
partners within the supply chain.
APM Terminals’ North American C-TPAT
security profile, which summarizes the
procedures we have in place to ensure
effective supply chain security worldwide,
was unconditionally validated by the US
Department of Homeland Security (DHS)
on December 31, 2007. APMT is also an
integral partner of the US Government’s
global Secure Freight Initiative,
specifically working with the DHS in a
new comprehensive container imaging
and scanning project at the Port of
Salalah, Oman.
In the United States, APM Terminals is
working very closely with the Transportation
Security Administration (TSA) in the
U.S. Government’s rollout of the new
Transportation Workers Identification
Credential (TWIC) program. This initiative
will involve conducting background, terrorist
and criminal background checks and issuing
ID credentials to all categories of workers
(terminal employees, longshore, truckers,
vendors, contractors, etc.) requiring
unescorted access to/and on regulated
marine facilities (MTSA) in the U.S.
APM Terminals is also joining with
individual customers to conduct business
continuity planning and port recovery
and reopening exercises to ensure
full and responsive compatibility with
customer needs.
Environment
To support our goal of continually
improving our environmental performance,
we are investing in innovative solutions
and partnering with industry pioneers. For
example, we have teamed up with one of
our vendors to develop the Eco-RTG, a new
environmentally-friendly rubber tired gantry
crane that operates with less fuel, and has
the ability to cycle energy during the lift/lift
off phase of operations. These advanced
Eco-RTGs are now in use at our terminals
in Algeciras, Tangier, Xiamen and Pipavav,
which are benefiting from lower fuel costs,
emissions, noise and fumes. We plan to
extend this initiative to other facilities
within our global terminal network.
In addition to best-practice sharing, we
are also investing in other technologies
and equipment including: new cleaner
cargo handling equipment engines,
equipment to control idling to reduce
pollution and fuel use, increased ondock rail capacity, electrification of key
operations, and equipment which will
lead to more effective and efficient
movement of goods, less congestion,
and better air quality.
Our new container terminal in Portsmouth,
Virginia, clearly demonstrates the
environmental considerations that APM
Terminals takes into account when
developing new container terminals. We
installed the most up-to-date equipment
to minimize pollution and fuel use; we
preserved 110 acres of woodland on the
site, planted 110,000 wetland plants in a
lagoon next to the dock, and contributed
$5.3 million to cleaning up the local
Elizabeth River. We believe that this
facility is the most environmentally-friendly
terminal in North America.
Twinlift
24 APMofTerminals
MSC containers
2007 Annual
at portReview
of Yangshan, Shanghai, China
Leadership
perspectives
Process excellence
Martijn Van de Linde
VP Operations
Our process excellence initiative was
formulated in the early part of 2007, and
began to bear fruit during the latter part
of the year with projects successfully
implemented at four terminals.
In Asia, process excellence teams
made significant improvements to crane
efficiency, by reducing shift change idle
time by up to 80% and reducing gantry
crane breakdown response times.
In other parts of the world, process
excellence projects include improvements
to customer invoicing accuracy and
cycle times, and improvements to our
engineering inventory management
processes, which will result in millions of
dollars in savings over the next four years.
Through 2008 we will expand our process
excellence initiative by increasing in-house
training and creating global communities
of experts to accelerate the reduction of
costs from the business.
We will prioritize our process excellence
activities by focusing on those terminals
where we will be able to deliver maximum
value for our customers. Our goal is to have
process excellence in place at all facilities
in the APM Terminals global terminal
network by 2009. In the longer term, we
intend to roll our refined processes into all
new start-ups, so that they too can take
advantage of the benefits realized through
improved process designs.
Commercial
Tiemen Meester
Chief Commercial
Officer
Innovation
Simo Hoite
Director for R&D
and Innovation
2007 was characterized by significant
change within the container industry and
APM Terminals has responded to these
changes with passion and commitment to
meet the needs of the industry now and
into the future.
Innovation leadership is one of the most
critical components defining success in
highly successful corporations. Our focus
on innovation empowers our people to
deliver cutting-edge solutions to provide our
customers with a competitive advantage.
One important factor has been the trend
for many shipping companies to move
towards strategic partnerships with
terminal operators rather than individual
localized deals. The strength of our
expanding global terminal network will
be a distinct advantage as this trend
accelerates. But global capabilities need
to be matched by responsiveness at a
local level. That is why we have created
seven regional offices which are now fully
staffed and receiving positive feedback
from our customers.
Our approach: we are looking for ideas
- from small ideas, to breakthrough
ideas - that can help our company make
continuous improvements in our efficiency,
effectiveness, operations, service levels,
and culture in everything we do.
We have also implemented a
comprehensive research and development
program which will continue to gain
momentum and deliver progress in the
years ahead.
Looking to 2008, we will be further
strengthening and organizing our
commercial resources to be customerfocused. We will anticipate industry trends
by placing the shipping community at the
heart of our business organization. Our
company policy of community involvement
on a local level will also help to distinguish
us from our competition.
We have taken the opportunity to redefine
ourselves as a company. We have the
potential to redefine the industry. It is an
exciting challenge, a great responsibility,
and a goal we intend to meet in 2008.
APM Terminals’
organization
APM Terminals’ Board of Directors:
Nils Smedegaard Andersen, Chairman
Soren Thorup Sorensen
Kim Fejfer
Lars Reno Jakobsen
Anthony Scioscia
Corporate Leadership Team:
Kim Fejfer, CEO
Peder Sondergaard, COO
Christian M. Laursen, CFO
Tiemen Meester, CCO
Simon Reitsma, VP, Human Resources
Klaus R. Sejling, VP, Business Development
Front row, left to right:
Michael L. Hansen, MD, Apapa, Africa, Kim Fejfer, CEO, Martijn Van de
Linde, VP, Operations, Soren S. Jakobsen, VP, Americas, Helen Cowing,
VP and Deputy CFO, Peder Sondergaard, COO, Kim R. Gadegaard, VP,
Greater China, Jorgen H. Madsen, VP, West & Central Asia
Strategic Leadership Team:
Kim Fejfer, CEO
Peder Sondergaard, COO
Christian M. Laursen, CFO
Tiemen Meester, CCO
Simon Reitsma, VP, Human Resources
Klaus R. Sejling, VP, Business Development
Martijn Van de Linde, VP, Operations
Helen Cowing, VP and Deputy CFO
Richard Nicholson, VP, Africa
Soren S. Jakobsen, VP, Americas
Martin G. Christiansen, VP, Asia-Oceania
Martin Poulsen, VP, Europe
Kim R. Gadegaard, VP, Greater China
Eric A. Sisco, CEO, North America
Jorgen H. Madsen, VP, West & Central Asia
Michael L. Hansen, MD, APM Terminals Apapa, Nigeria
Gary Lemke, CEO, Salalah, Oman
Back row, left to right:
Simon Reitsma, VP, HR, Martin Poulsen, VP, Europe, Eric Sisco,
CEO, North America, Christian M. Laursen, CFO, Klaus R. Sejling,
VP, Business Development, Tiemen Meester, CCO, Gary Lemke,
CEO, Salalah, Oman, Martin G. Christiansen, VP, Asia/Oceania
2007 - a year
of investment
As we look forward to 2008, we celebrate our achievements of 2007,
and the spirit of innovation, partnership and community which enables
APM Terminals to continue to offer the most efficient and customerfriendly service in the industry through the world’s only integrated,
comprehensive and geographically balanced global terminal network.
• Gateway Terminals India, Mumbai
• Meridian Port Services, Port of Tema, Ghana
• Shenzhen Dachan Bay Phase II Container Terminal, Shenzhen, China
• Terminal de Containers do Vale do Itajai, Brazil
• APM Terminals Tangier, Tangiers Med Port Complex, Tangiers, Morocco
• Sogester, Port of Luanda, Angola
• Tianjin Alliance International Container Terminal, Tianjin, China
• APM Terminals Virginia, Portsmouth, Virginia, USA
• Songyu Phase I Container Terminal, Songyu Port, Xiamen, China
• Suez Container Canal Terminal Phase II, Port Said, Egypt
• Nansha Phase 2 South China Oceangate Container Terminal,
Guangzhou, China
• Alinport S.A, Port of Posorja, Ecuador
• Terminal Port Oceane, Port of Le Havre, France
APM Terminals
Anna Van Saksenlaan 71
2593 HW The Hague
Netherlands
apmterminals.com

2007 Annual Review Redefining the Industry

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